US October housing starts 1.246m vs 1.325m expected

The latest data indicates that U.S. housing starts in October fell to 1.246 million, below the expected 1.325 million and down from the prior month's 1.307 million. This figure represents the lowest level since the COVID-19 pandemic and reflects ongoing weakness in the housing market due to high mortgage rates and a sluggish labor market. Additionally, building permits rose to 1.412 million, surpassing the forecast of 1.350 million, indicating a potential slight recovery in construction permitting. Former President Trump announced a $200 billion purchase of mortgage-backed securities (MBS) to lower mortgage rates, potentially providing support to the ailing housing market. Following this news, housing-related stocks saw gains. Trump's focus on housing affordability amid the political backdrop may indicate efforts to keep the economy buoyant, especially with impending mid-term elections. However, re-accelerating inflation could force the Federal Reserve to raise rates or maintain high rates longer, posing risks to the housing market. Market watchers should look for further developments in this area.